Dollar Dives and Metals Surge: Powell Investigation Sparks Institutional Crisis

The US Dollar faced intense selling pressure on Monday, breaking below key technical levels against major peers, including a drop below 1.3900 in USD/CAD. The catalyst extends beyond economic data to a rare institutional shock involving the Federal Reserve.

Fed Independence Under Siege?

Reports confirmed that the US Justice Department has issued a subpoena to Fed Chair Jerome Powell regarding his Senate testimony from last June concerning a $2.5 billion renovation project. Powell acknowledged the threat of criminal charges, shaking the financial establishment which prizes Central Bank independence.

While President Trump denied direct involvement, he criticized Powell on NBC News, amplifying political pressure on the bank to lower interest rates.

Safe Haven Rotation: Gold and Silver at Record Highs

The combination of institutional instability and soft economic data has triggered a classic flight to safety, bypassing the Dollar.

Economic Backdrop: The Tariff Drag

The US labor market is showing significant strain, with economists like Moody's Mark Zandi pointing to aggressive tariff policies as a driver.